NFT platform Omni was hacked to steal 1300ETH

Source: https://blockchain.news/news/nft-lender-omni-hacked-for-1300-eth

The Omini NFT money market platform allows users to stake their NFTs (usually popular NFT collectibles such as Bored Ape Yacht Club) on the platform to obtain tokens such as ETH.

While hackers managed to steal more than 13 million wETH ($1.4 million) — the ERC20 transactional version of ETH — Omni said the theft did not affect customer funds. The company added that only internal testing funds were affected as the platform is still in beta testing mode.

According to Omni, the agreement has been suspended for a full investigation.

Projects coded in Solidity are prone to reentrancy. It allows hackers to force their smart contracts to make external calls to an untrusted contract.

Zhou Yajin, chief executive of blockchain security firm BlockSec, said hackers deposited Doodles NFT to borrow wrapped ETH (wETH), a tokenized version of the cryptocurrency pegged to the value of the original currency.

After depositing a margin and liquidating the position, the remaining Doodle NFT in the original collateral is returned to the attacker.

Hackers will often liquidate loan positions because the value of the NFT as collateral is insufficient to cover the debt position before the callback function is called. To get around this, hackers often take advantage of reentrancy, as they are able to forcibly use the borrowed wETH to buy more NFTs before liquidation occurs.

Additionally, Zhou added, the hackers then borrowed more wETH using the Doodles NFT acquired on the initial loan as collateral. However, since Omni did not recognize this new position, hackers were able to withdraw the NFT without repaying the loan.

Data from Etherscan shows that hackers have laundered money through a mixer called Tornado Cash.